Ola Electric, once the face of India’s two-wheeler electric mobility ambitions, is now navigating a bumpy road marked by financial losses, regulatory heat, and eroding market share. Yet, in a twist that defies expectations, its shares jumped 17% on Monday to Rs 46.67 on the BSE, even as its loss widened to Rs 428 crore for the quarter ended June 2025 from Rs 347 crore a year earlier and sales halved.
Its operating revenue halved year-on-year to Rs 828 crore, down from Rs 1,644 crore. Even a 42% cut in total expenses couldn’t cushion the blow.
To be sure though, beyond the headline loss, the company reported several operational improvements that could indicate a potential turning point in its path to profitability.
Ola's revenue fell compared to last year, but the company still met its own sales target and grew more than 35% from Rs 611 crore in the March quarter. In a major milestone, Ola’s electric vehicle business became EBITDA positive in June — the first time this has happened. The company also posted its highest-ever gross margin of 25.6% for the quarter, even though some key models are still waiting for government approval to qualify for PLI scheme benefits.
Also Read: Also Read: Ola Electric shares surge over 17% despite posting Rs 428 crore loss in Q1
However, Ola’s problems could go far beyond this.
Since debuting on the markets, Ola’s stock has tumbled from its listing price of Rs 91.20, well above its IPO issue price of Rs 76. It had once even breached Rs 150. However, the stock hit record low of Rs 39.76 on Friday.
A crackdown in Maharashtra
A report by Mint revealed that the Maharashtra government recently ordered the closure of nearly 90% of Ola’s showrooms in the state. According to a July 3 letter from the state transport department, only 44 of the 432 Ola outlets inspected had valid trade certificates. The remaining 388 were ordered to shut shop.
The company dismissed the report as “speculative, incorrect and misplaced,” while confirming it is working with state authorities to address compliance issues.
Still, this isn’t Ola’s first regulatory run-in. In April, Maharashtra Transport Commissioner Vivek Bhimanwar told Mint that 75 stores had already been closed, and show-cause notices were issued to 270 more.
A mismatch between reported sales and actual vehicle registrations had earlier raised red flags. Ola cited 25,000 sales in February, but only 8,500 scooters were registered.
Losing ground in the EV race
Ola Electric, once the leader in India’s electric two-wheeler market, remained in the third position for the second consecutive month in June 2025. The company registered 18,527 units, nearly unchanged from May’s 18,541 units, and held a market share of 19.6%—still below the 20% mark it previously maintained. Legacy players TVS Motor and Bajaj Auto continued to lead the segment, capturing 25.4% and 22.8% of the market, respectively, according to data from the Vahan portal.
The electric two-wheeler segment as a whole witnessed a slight decline in volumes, with 94,299 units registered in June compared to 96,858 in May, reflecting a broader dip in demand.
Meanwhile, Ather Energy gained some ground. It improved its market share from 13.4% in May to 14.4% in June, with sales rising to 13,617 units.
Customer outrage and the CCPA’s intervention
Even as it deals with government scrutiny, Ola continues to wrestle with customer dissatisfaction.
In October last year, comedian Kunal Kamra called out the company for poor service, triggering a public spat with Aggarwal on X (formerly Twitter). At the same time, Central Consumer Protection Authority (CCPA) also stepped in after receiving over 10,000 complaints.
While Ola claimed to have resolved 99.1% of them, the CCPA was reportedly still reviewing the matter amid lingering discontent.
The FAME-II fallout
Apart from Ola’s troubles, there's a broader shakeout in the electric two-wheeler market, where regulatory action has thinned the herd.
On Monday, Economic Times reported details how the government’s crackdown on misuse of FAME-II subsidies—a program offering incentives to EV makers—has hit several manufacturers hard. Thirteen companies were found to have violated localisation rules, with six directed to return a combined Rs 469 crore in subsidies.
The Ministry of Heavy Industries suspended disbursals after discovering violations by Hero Electric, Okinawa Autotech, Greaves, Revolt, Benling, and AMO Mobility. Of these, only three have returned Rs 170 crore. The others are contesting the directive in court.
Sales have plunged sharply across several electric two-wheeler manufacturers following the government's crackdown on FAME-II subsidy violations. Okinawa Autotech, which sold 31,618 units in 2023, managed only 4,855 units in 2024, and just 1,422 so far in 2025. Hero Electric has seen an even steeper fall—from 29,965 units in 2023 to a mere 382 this year. The company is currently undergoing insolvency proceedings. Smaller players like Benling India and AMO Mobility have virtually disappeared from the market, with sales this year dropping to just 25 and 95 units, respectively.
“This is a case of regulatory action that essentially took the wind out of these companies,” VG Ramakrishnan, managing partner at Avanteum Advisors, told ET. “They benefited from the subsidies without following the rules and ultimately paid the price.”
Adding to the pressure, the Serious Fraud Investigation Office (SFIO) launched a probe in December 2024 into several companies for allegedly falsifying documents to claim subsidies. The enforcement push triggered sharp price hikes across EV models, cooling consumer demand.
What’s next for Ola?
Despite the headwinds, Ola remains one of the sector’s key players—alongside TVS, Bajaj, and Ather. It continues to invest in its distribution network and operational efficiency.
But the road to redemption may take more than expansion plans and marketing blitzes. In a market where policy shifts can redraw the playing field overnight, Ola will need to double down on compliance, customer care, and quality if it hopes to recharge its image and regain lost ground.
The spark that once lit up India’s EV dreams now faces a big test.
Its operating revenue halved year-on-year to Rs 828 crore, down from Rs 1,644 crore. Even a 42% cut in total expenses couldn’t cushion the blow.
To be sure though, beyond the headline loss, the company reported several operational improvements that could indicate a potential turning point in its path to profitability.
Ola's revenue fell compared to last year, but the company still met its own sales target and grew more than 35% from Rs 611 crore in the March quarter. In a major milestone, Ola’s electric vehicle business became EBITDA positive in June — the first time this has happened. The company also posted its highest-ever gross margin of 25.6% for the quarter, even though some key models are still waiting for government approval to qualify for PLI scheme benefits.
Also Read: Also Read: Ola Electric shares surge over 17% despite posting Rs 428 crore loss in Q1
However, Ola’s problems could go far beyond this.
Since debuting on the markets, Ola’s stock has tumbled from its listing price of Rs 91.20, well above its IPO issue price of Rs 76. It had once even breached Rs 150. However, the stock hit record low of Rs 39.76 on Friday.
A crackdown in Maharashtra
A report by Mint revealed that the Maharashtra government recently ordered the closure of nearly 90% of Ola’s showrooms in the state. According to a July 3 letter from the state transport department, only 44 of the 432 Ola outlets inspected had valid trade certificates. The remaining 388 were ordered to shut shop.
The company dismissed the report as “speculative, incorrect and misplaced,” while confirming it is working with state authorities to address compliance issues.
Still, this isn’t Ola’s first regulatory run-in. In April, Maharashtra Transport Commissioner Vivek Bhimanwar told Mint that 75 stores had already been closed, and show-cause notices were issued to 270 more.
A mismatch between reported sales and actual vehicle registrations had earlier raised red flags. Ola cited 25,000 sales in February, but only 8,500 scooters were registered.
Losing ground in the EV race
Ola Electric, once the leader in India’s electric two-wheeler market, remained in the third position for the second consecutive month in June 2025. The company registered 18,527 units, nearly unchanged from May’s 18,541 units, and held a market share of 19.6%—still below the 20% mark it previously maintained. Legacy players TVS Motor and Bajaj Auto continued to lead the segment, capturing 25.4% and 22.8% of the market, respectively, according to data from the Vahan portal.
The electric two-wheeler segment as a whole witnessed a slight decline in volumes, with 94,299 units registered in June compared to 96,858 in May, reflecting a broader dip in demand.
Meanwhile, Ather Energy gained some ground. It improved its market share from 13.4% in May to 14.4% in June, with sales rising to 13,617 units.
Customer outrage and the CCPA’s intervention
Even as it deals with government scrutiny, Ola continues to wrestle with customer dissatisfaction.
In October last year, comedian Kunal Kamra called out the company for poor service, triggering a public spat with Aggarwal on X (formerly Twitter). At the same time, Central Consumer Protection Authority (CCPA) also stepped in after receiving over 10,000 complaints.
While Ola claimed to have resolved 99.1% of them, the CCPA was reportedly still reviewing the matter amid lingering discontent.
The FAME-II fallout
Apart from Ola’s troubles, there's a broader shakeout in the electric two-wheeler market, where regulatory action has thinned the herd.
On Monday, Economic Times reported details how the government’s crackdown on misuse of FAME-II subsidies—a program offering incentives to EV makers—has hit several manufacturers hard. Thirteen companies were found to have violated localisation rules, with six directed to return a combined Rs 469 crore in subsidies.
The Ministry of Heavy Industries suspended disbursals after discovering violations by Hero Electric, Okinawa Autotech, Greaves, Revolt, Benling, and AMO Mobility. Of these, only three have returned Rs 170 crore. The others are contesting the directive in court.
Sales have plunged sharply across several electric two-wheeler manufacturers following the government's crackdown on FAME-II subsidy violations. Okinawa Autotech, which sold 31,618 units in 2023, managed only 4,855 units in 2024, and just 1,422 so far in 2025. Hero Electric has seen an even steeper fall—from 29,965 units in 2023 to a mere 382 this year. The company is currently undergoing insolvency proceedings. Smaller players like Benling India and AMO Mobility have virtually disappeared from the market, with sales this year dropping to just 25 and 95 units, respectively.
“This is a case of regulatory action that essentially took the wind out of these companies,” VG Ramakrishnan, managing partner at Avanteum Advisors, told ET. “They benefited from the subsidies without following the rules and ultimately paid the price.”
Adding to the pressure, the Serious Fraud Investigation Office (SFIO) launched a probe in December 2024 into several companies for allegedly falsifying documents to claim subsidies. The enforcement push triggered sharp price hikes across EV models, cooling consumer demand.
What’s next for Ola?
Despite the headwinds, Ola remains one of the sector’s key players—alongside TVS, Bajaj, and Ather. It continues to invest in its distribution network and operational efficiency.
But the road to redemption may take more than expansion plans and marketing blitzes. In a market where policy shifts can redraw the playing field overnight, Ola will need to double down on compliance, customer care, and quality if it hopes to recharge its image and regain lost ground.
The spark that once lit up India’s EV dreams now faces a big test.
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